de- & re-territorialization: finance & fractals

Appadurai claims that finanscapes are becoming ever more deterritorialized, citing flows of commodities and consumerist tastes that cross borders increasingly quickly and with little regard to traditional regional unities or cultural affinities. Yet Appadurai's focus on the production and consumption of commodities does not do full justice to the "deterritorialization" of the finanscape. As Lee claims, the unmooring of currencies from gold, the ensuing speculation in currencies, and derivative financial products create capital from capital itself. I take the process Lee describes to be "deterritorialization" because this notion is not Appadurai's invention; it was most popularly mobilized by Deleuze and Guattari to describe the evolution of capital, and in their use of "deterritorialization" the term is not primarily geographic. Instead, D&G's use of the term can connote a shift in the grounding of value, whether this value is economic, lingustic, or conceptual.
Thus, I claim that finanscapes and capital are deterritorialized in at least three senses: capital flows more easily and more rapidly between national markets (geographic deterritorialization); capital can be produced from speculation upon stocks and currencies, not from their sale (deterritorialized from its 'grounding' in production/consumption); and derivative financial products such as call options generate capital because of their expiration dates and financial equations of risk over time, not because of abstract labor-time (deterritorialization from its grounding in worker's time).
And while Appadurai focuses on deterritorialization and disjuncture, D&G's work stresses that when deterritorializations occur, so do reterritorializations. Lee's article is again instructive—flows of commodities are not simply more geographically mobile, but rather capital's basis in traditional forms has been displaced onto new forms that reterritorialize value on a different plane. Thus, along with value based on the laborer's effort over a duration of time we now have value that is based on a metatemporal scale, fundamentally predicated on economic modeling of the future and realized depending on the value, not as time (as in the commodity), but value (of a stock) at a point in time (Lee & LiPaum, 205). Lee's article, with its emphasis on circulation, shows how circulation does not merely deterritorialize commodities and labor (products made in China are shipped to the U.S., traditional modes of value are elided by financial products), but instantiates a new form of value that is reterritorialized in circulation (that is, reterritorializes them in a territory that is not one).
All this is not to criticize Appadurai unduly, but to point out where his own notion of deterritorialization goes further than the examples he chooses to illustrate it. In fact, speculative finance underscores the role of mediascapes (in publicizing economic disaster, producing further crises of faith) and economic modeling (whose –scape I'm having difficulty pinning down) in the production of financial capital. It seems that Appadurai has a bias towards the landscape, proving the deterritorialization of different –scapes in terms of geographical disjuncture. Yet the concept of deterritorialization allows us to examine not only the dispersion and disjuncture of different scapes in space, but also to point out how different scapes are de- and re-territorialized in themselves. The convoluted space of financial capital, in which values generate other values, is indeed the kind of fractal space generated by feedback loops of speculation.
Moreover, according to one source at least, fractals are actually already used "to make predictions as to the risks involved in particular stocks." Fractals, as mathematically abstract representations, may be useful in mapping different scapes, but for the finanscape at least, fractals constitute at least part of this space. Fractal economic modeling is involved in the calculation of risk, which determines the prices of derivative products, which in turn generate both value and risk. 

A question: how, if at all, do the 'financial crisis' and ensuing regulations (or lack thereof) change the circumstances Lee describe in his article?

"Democratic" Protocol?

One aspect of Galloway’s introduction that I found particularly interesting (and a bit confusing), was the emphasis on protocol as “democratic” (13, 25). I think this term is crucial since it is such a central theme to the way people often speak about the internet, suggesting that it is a more ‘democratic’ medium than previous media forms (such as book publishing). Internet technologies are cited as unique and important precisely because of their potential as ‘democratic’ tools. Yet Galloway argues, “While protocol may be more democratic than the panopticon in that it strives to eliminate hierarchy, it is still very much structured around command and control and has therefore spawned counter-protocological forces” (13). What impact, then, does this democratization of control have on our societies? Galloway goes on to say that “protological control is still an improvement over other modes of social control…it is through protocol that one must guide one’s efforts, not against it” (17). While I certainly could benefit from further clarification about the idea of “protocol” itself, my curiosity is why Galloway seems to suggest that just because control is more “democratic”, it is better than other forms? And what does that democratization entail? It seems that in Galloway’s formation, “democratic” is substituted for “distributed”, but I think this may elide some important differences.

Is protocol truly “democratic”? To me, this brings up issues of participation and agency – in a democracy, at least in theory, people participate in the creation of their government and in so doing affect its form. Is this the case with protocol? I may simply be misunderstanding the use of the term in this context, but Galloway clearly wishes to link the technological form with the governmental or societal one. So one open question for me is whether this is a fair comparison, but I would also very much welcome anyone who would like to argue with my interpretation here or elucidate the meanings of these terms further.

For Sale to the Highest Bidder: The Commodification of Legitimacy

"Is legitimacy to be found in consensus obtained through discussion?" (Intro, xxv)

This question, posed by Lyotard in the Introduction, brought me back to our discussion of imagined communities, and the idea that imagined communities might come into being through the performative recognition of the community by an external observer. In the same way that I believe communities may be realized by external forces or by internal ones, I believe legitimacy can be reached either through consensus (internal forces) or by imposition (external forces).

Lyotard goes on to discuss the development of "knowledge in the form of an informational commodity" (5), and the power of those who have achieved competence within the various forms of language games (18). This brings up several interesting points. If the prior question of legitimacy as formed by consensus can be answered in the affirmative, and knowledge--the basis for discussion leading to consensus--has become a commodity to be bought and sold, can legitimacy itself, then, be bought and sold? If consensus, reached through sharing (or buying/selling) knowledge between members of a community, is indeed the basis for legitimacy, the commodification of legitimacy must not be far off. However, if the basis for legitimacy is imposition of regulations by an external force, does this make the commodification of legitimacy more or less likely? I'm not sure what I think about this possibility either, but thought I would open up the floor for discussion.

What are the implications of a tradeable legitimacy?